Business

L.A. Sues Time Warner Over Unpaid Fees

The city alleges Time Warner Cable has not paid $10 million in franchise fees over a period of four years, despite attempts to negotiate.

L.A. Sues Time Warner Over Unpaid Fees
Wikimedia Commons / Ildar Sagdejev
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The city of Los Angeles is suing Time Warner Cable for almost $10 million in unpaid fees over a period of four years.

According to the Los Angeles Times, the suit alleges the company has earned about $500 million a year in the city, but it owes taxpayers for unpaid franchise fees and fees for broadcasting public, educational and government channels between 2008 and 2011.

FEUER: "The money we allege in this complaint would fund a hundred police officers. It would fund 15 miles of sidewalk repair and the trimming of 60,000 trees in the city." (Via KTTV)

The city attorney's office claims Time Warner has refused to pay the fees partly because of a previous 2008 civil suit that alleged "unfair, deceptive and fraudulent business practices" when the company hiked its rates. (Via KABC)

Time Warner has a virtual monopoly of cable services in the area and has been criticized for its services.

Business Insider marked Time Warner as the third "most hated company" in the U.S. — citing poor quality, service complaints and unexpected fee hikes. 

It's even reportedly starting to monopolize local sports coverage. According to LA Weekly, only Time Warner subscribers will be able to watch Dodgers games as the company has been unable to convince rivals to pay high fees to air its new LA Dodgers channel. 

In response to the suit, Time Warner issued a statement denying the accusations — and says, "As a major job creator, tax contributor and service provider in the city of Los Angeles, Time Warner Cable is an active and responsible corporate citizen ... We strongly believe [the legal action] is without merit." (Via Los Angeles Daily News)

Time Warner is currently pending a $42 billion takeover by Comcast. It's currently unclear how the lawsuit will affect its cable customers in LA.